BHP Billiton Warns Job Cuts Are On The Way As Iron Ore Price Plunges

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The falling price of iron ore is hitting the big miners with BHP Billiton revealing today it will review its Western Australian workforce numbers to ensure it remains globally competitive in a lower commodity price environment.

With the iron ore price falling around 20% over the last two months to below the $100-threshold, BHP has cut about 500 jobs from its iron ore operations in the west, including 100 jobs from its Perth headquarters and another 170 positions at the Mt Whaleback mine in the Pilbara.

A spokesperson said a company-wide review is currently underway and will look at both employee and contractor numbers. BHP employs 16,000 people in its Australian iron ore division.

Reports are circulating that up to 3,000 jobs could be cut from iron ore, however the BHP spokesperson said this number has not been confirmed.

BHP has engaged external consultants to run the review and according to The West Australian, they are recommending about 20 per cent of the current workforce be axed.

However the miner said the process “is about continuing to safely improve our business and ensuring we are a competitive, world-class operation”.

It is understood job numbers could be reduced by using a number of strategies including natural attrition, not filling open roles, restructuring teams and not renewing contracts.

“We have been open with our employees about the work being done to improve productivity, and the review, and we hold regular all employee Town Hall meetings and question and answer sessions with the business leaders as a matter of course,” BHP said in a statement.

“In situations where employees are impacted we will undertake every effort to assist them throughout the process and to seek redeployment opportunities where possible.”

The cost reduction and productivity focus is not a new one for the miner, which began employing a capital rationalisation agenda almost two years ago as mining investment began to drop off and new operations were ramping up.

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